اقتصاد های باز کوچک ریشه واحد نزدیک
|کد مقاله||سال انتشار||مقاله انگلیسی||ترجمه فارسی||تعداد کلمات|
|45883||2015||10 صفحه PDF||سفارش دهید||6754 کلمه|
Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)
Journal : Journal of Economic Dynamics and Control, Volume 53, April 2015, Pages 37–46
The marginal utility of wealth in incomplete markets small open economy models follows a unit root process. I study the nonlinear properties of devices often used to remove the unit root and I find that they generate different dynamics when matching emerging markets. Models with endogenous discount factors reinforce consumption response to shocks and increase the countercyclicality of the trade balance to output ratio. Conversely, models with debt frictions ameliorate the responses of consumption and trade balance. Hence, to generate dynamics similar to those in emerging economies, the debt frictions need to be small, inducing a near unit root behavior in their Euler equations. This difference across models is hidden when matching developed economies because of consumption smoothing and the mild countercyclicality of the trade balance.